Shahizad Bin Sulaiman
Introduction
The advancement of internet has revolutionized many aspects of human life including the way of purchasing goods and services. Instead of facing the hassle to get to the brick and mortar market, consumers today can buy goods and services at their comfort home and anytime. Furthermore, with the invention of smartphone, the e-commerce is transformed into mobile commerce or m-commerce. This new trend of purchasing had introduced the concept of e-commerce and e-consumer. The Organization for Economic Co-operation and Development (OECD) defines electronic commerce or e-commerce as the sale or purchase of goods or services, conducted over computer networks by methods specifically designed for the purpose of receiving or placing orders[1]. Hence, e-consumers generally refer to the purchaser of goods and services over electronic systems such as Internet and other computer networks[2].
According to a survey conducted in 2018 by the Malaysian Communications and Multimedia Commission (MCMC), the e-commerce contributed 6.3% to the 2017 Malaysian Gross Domestic Product (GDP) and percentage of e-consumer at national level stood at 51.2%[3]. This indicates that the e-commerce is a future form of conducting business that will benefit not only the consumer but also the country. The e-commerce also shows its resilience during the pandemic time during which the movement of individual is restricted. Though many businesses face a great challenge to survive during the Covid-19 pandemic, but the Malaysia’s online retail sales recorded a surge of 28.9% in April 2020, although the total sales value of wholesale and retail trade dropped 36.6% as compared with the same month a year earlier[4].
The increase percentage of online shopping is attributed to the advantages that it offers to the consumers, among others:
- convenience since the e-market is accessible at all time and everywhere as long as internet connectivity is available;
- provision of vast selection of local and international products;
- best pricing due to aggressive competition between e-traders;
- information about the products is also easily obtained from the webpage; and,
- easy method of payment.[5]
Nowadays, the medical products such as drugs are also sold online through e-pharmacy. E-pharmacy is the trading of pharmacy goods and services through electronic means. Undeniably the development of e-pharmacy helps the patients to acquire the medicines easily, however, there are concerns such as wrong prescription and lack of quality medicines supplied which could endanger the life of the consumers. The traditional medicines and cosmetic products businesses are also using the online platform to entice consumers to buy their products. Banking sector is also expanding their business to online platform via Internet banking which has been widely used by the consumer as it is much easier and time saving as compared to the traditional banking.
However, online shopping is different from traditional shopping, in the following aspects:
- consumers often cannot verify the identity and integrity of vendors;
- consumers often cannot inspect products prior to making a purchase; and
- while the conclusion of an online transaction may be done quickly, consumers do not have enough time to go through the terms and conditions before acceptance.
In some cases, the risks of misleading and deceptive practices are apparently much higher for certain types of online transactions, particularly when the vendors involved are remote and do not have established track records[6]. These created new challenges to online purchasing such as payment security, data protection, unfair contract terms, validity and implementation of e-contracts, inadequate disclosure of information and unfair trade transactions, late or non-delivery of goods, misleading information and false advertisements and quality of goods and services. This led us to question the extent of protection provided to online shoppers under the law in Malaysia.
Protection for e-consumer in Malaysia
In Malaysia, the protection available to purchasers of online goods and services can be found primarily in the Electronic Commerce Act 2006 (ECA), Consumer Protection Act 1999 and Consumer Protection (Electronic Trade Transactions) Regulation 2012. The Electronic Commerce Act 2006 (ECA) does not outline the regulation for safe online transaction but it provides for legal recognition of electronic messages in commercial transactions, the use of the electronic messages to fulfill legal requirements and to enable as well as facilitate commercial transactions through the use of electronic means and other matters connected therewith. This provision is important to enable all electronic messages in relation to online commercial transaction to be used as evidence in any judicial proceeding in relation to any dispute related to such commercial transaction.
Initially, online commercial transactions were not covered by the Consumer Protection Act 1999 (CPA). However, the CPA was amended in 2007 whereby Section 2(2)(g) of the CPA which expressly stated that the Act would not apply “to any trade transactions affected by electronic means unless otherwise prescribed by the Minister” was removed and Section 2(1) was inserted with “any trade transactions conducted through electronic means”[7]. Therefore, the protection for consumers provided under the CPA is now also extended to the online purchaser. This means protection under the CPA applies to all consumers irrespective of the method of transactions. The protection for e-consumers has been further strengthened by the enactment of the Consumer Protection (Electronic Trade Transactions) Regulations 2012. The CPA is the first legislation that provides specifically for consumer protection in relation to the supply of goods and services.
Another relevant law is the Direct Sales and Anti-Pyramid Scheme Act 1993 (DSASA) which was amended in 2010 to widen the scope of mail order to include ‘any other means of mailing including through electronic means. A clear effect of the amendment is that all e-commerce companies must have direct sales licence and comply with the direct sales law and protection for consumers under the Act are now equally applicable to the e-consumers.[8]
Analysis of e-consumer protection in Malaysia, Australia and United States
Australia and United States are among developed countries that have better internet access which is a main factor for a speedy proliferation of online shopping. Both countries also have several legislations that protect the consumers’ rights. Hence, comparison on the extent of protection available to e-consumers in Malaysia, Australia and United States is made based on the issues faced by the e-consumers.
1. Misleading information, false advertisements and unfair practises in online market
Information of the goods and services is crucial for e-consumer as their decision on buying goods and services depending solely on the information provided on the vendor’s webpage. Therefore, there is a possibility for the vendors to exaggerate in describing their goods and services in order to allure the e-consumers. In addition, the online vendor may also resort to unfair practices such as misleading price indication and deceptive advertising technique. In this regards, Section 10 and Section 12 of Consumer Protection Act (CPA) prohibit misleading and false representation of the products and services and misleading price indication. Upon conviction of contravening Section 10 or Section 12 of CPA, an individual is liable to a fine not exceeding RM100,000 or to 3 years imprisonment or to both and a body corporate is liable to a fine not exceeding RM250,000.
A similar provision could also be found under US Federal Trade Commission Act (FTC Act) and Australian Consumer Law. Section 5(a) of the Federal Trade Commission Act (FTC Act) prohibits “unfair or deceptive acts or practices in or affecting commerce.” This prohibition applies to all persons engaged in commerce, including banks. Section 52 of Federal Trade Commission Act makes an offence to desiminate false advertisement and upon conviction that person shall be punished by a fine of not more than $5,000 or by imprisonment for not more than 6 months, or by both. Additionally, the US Free Trade Commission (FTC) also issued Dot Com Disclosures guidance document in 2000 to prevent unfair or deceptive practices. Dot Com Disclosures requires all advertisements and other commercial communications made online to be clear and conspicuous. Representations about commercial products or services made online must be easily visible and understandable to the average consumer, and the website owner is responsible to ensure that consumers receive fair and accurate information[9]. In Australia, Section 29 of Australian Consumer Law (ACL) prohibits false or misleading representations about goods or services and Section 47 prohibits multiple pricing. An example of the enforcement of Section 29 of ACL is a case of an online pharmacy retailer that was investigated by Australian Competition and Consumer Commission (ACCC) in 2015. The e-pharmacy company displayed on its website an advertisement that by purchasing a specific health product through the retailer’s website, consumers would save a specified amount off the recommended retail prices. In this case, the ACCC found that the products were a private brand that is exclusively sold by pharmacies under the retailer’s group and it had never been offered for sale at the recommended retail prices by other retailers in the market. The ACCC therefore issued three infringement notices to the online pharmacy retailer totalling $32,400[10].
2. Bait Advertisement
However, the Malaysia CPA goes further to provide a specific protection by prohibiting bait advertisement under Section 13 of the CPA. Bait advertisement is an advertisement technique used by the vendor by offering product or services at a lower price to allure e-consumers to buy the product but the real intention is to sale the higher-priced product. After showing interest to buy the product the consumer would be informed that the product offered was out of stock and other similar or better products with higher price are offered. Another technique frequently used by e-traders is giving gifts, prizes or free offers. Section 14 lays down the rules to be complied with if this method of sale promotion is used[11]. Such specific provisions are absent from US and Australian consumer protection laws.
3. Negative Option Marketing
Another unfair practice in online shopping is negative option marketing. It refers to a commercial transaction in which a seller interprets a customer's failure to take an affirmative action to reject an offer as affirmative acceptance to be charged[12]. We could find such method of marketing is applied in the renewal of online services subscription such as phone applications, virtual memory storage and online contents. Malaysia does not have a specific provision in law in relation to negative option marketing. In this respect, the United States passed the Restore Online Shopper’s Confidence Act 2010 (ROSCA) to prohibit online sellers from charging a consumer for any good or service with a negative option feature in an online transaction. Under Section 4 of ROSCA, the online sellers could only charge the e-consumer if they fulfill the following conditions: - clearly and conspicuously discloses to consumers all the material terms of the transaction;
- has obtained consumer consent before charging them; and,
- provides a simple way for consumers to stop charges.
The negative option marketing was also practiced in the Mobile premium services in Australia. Mobile premium service is a subscription service that is offered to consumers through mobile phone for mobile ringtones, weather forecast, online games and online competition. The consumer who subscribes to such service for a certain period would be charged through their mobile bill. To address the negative option marketing with regard to the service, the telecommunication service providers developed a Mobile Premium Services Code (MPSC). The code requires the service provider to obtain twice confirmations of a request from potential consumers before continuing their subscription to the ongoing service. The MPSC was later given a legal force by the Australian Communications and Media Authority (ACMA).[13]
4. Advertisement of Medical Products
In relation to medical products, Malaysia regulates the online advertisement of medical products by requiring all advertisement of medicines to be approved by Medicine Advertisements Board as stipulated under Section 4B of Medicines (Advertisement and Sales) Act 1956 before it can be published through electronic means. The advertisements approved by Medicines Advertisement Board (MAB) would display approval numbers begins with KKLIU, followed by 4 digits referring to the serial number and ends with year which refers to when the approval is submitted[14].
A similar provision is also found in the Therapeutic Goods Act 1989 in which the Therapeutic Goods Administration is given the authority to assess and approve medicines that are to be sold in Australia and on websites operated by Australian companies. Advertisement with regard to the approved medicine is subject to requirements under the Therapeutic Goods Regulations 1990 [15].
5. Unfair Practices in Banking Product
Whereas the Financial Services Act 2013 (FSA), Islamic Financial Services Act 2013 (IFSA) and the Development Financial Institutions Act 2002 (DFIA) prohibit financial service providers (FSPs) from engaging in conduct that is misleading or deceptive in relation to the nature, features, terms or price of any financial service or product[16]. Such prohibited business conduct is set out in Schedule 7 of the FSA and IFSA and the Second Schedule of the DFIA. The Central Bank of Malaysia also issued ‘Minimum Guidelines on the Provision of Internet Banking Services by Licensed Banking Institutions’ (MGIB) 2000. The MGIB is structured into 6 chapters dealing with the types of internet banking sites, oversight, risk management, security, consumer protection, compliance and other general requirements. The guideline requires banks to have webpage to educate customers on the various issues among others, Client Charter on Internet Banking, statement of liability, notification of any variation in terms and conditions, risks of internet banking[17].
6. Inadequate disclosure of information on webpage
Information of the products and the e-traders is important for the e-consumers in order for them to make an informed choice with regard to their online shopping. Moreover, the e-consumers would not be able to take action against e-traders on dispute arises from online transaction should they don’t have enough information of the e-traders such as name and contact address. By requiring the e-traders to display the specified information would hold the e-traders accountable for the supplied products and services. As compared to United States and Australia, Malaysia is quite advance in term of having an extensive provision to obligate the online business to disclose the following information in their website:
- Name of the person/business/ company
- Registration number of the business and company
- E-mail and telephone number/address
- A description of the main characteristic of the goods /services
- The full price including transportation costs, taxes and any other cost.
- The method of payment
- The terms of condition
- The estimated time of delivery
Such requirement is stipulated under the Consumer Protection (Electronic Trade Transactions) Regulations 2012 (CPR) which is to be read together with CPA. As for the online marketplace operator, they are required under Regulation 5 of CPR to keep and maintain a record of the names, telephone numbers and the address of the person who supplies goods and services in their online marketplace, for a period of 2 years. The online business and marketplace operators who are not complying with the regulation are liable under Section 145 of CPA, to a fine not more than RM50,000 or a 3 years imprisonment or both for individual and a fine of not more than RM100,000 for a corporate entity. Such requirement is also found under Section 20 of Direct Sales and Anti-Pyramid Scheme Act 1993 (DSASA) for advertisement in mail order sales. Thus, the practise of online traders of providing minimum information about their products and services and request the consumer to ‘private message’ them for details would be a contravention of CPR should the mandatory information as stipulated under the legislations are not displayed publicly in their webpage.
7. Delay or non-delivery of goods and services
Another usual problem faced by e-consumer is regarding the delivery of the products after the online purchasing. It was reported that, during the movement control order (MCO) period, from March till May 2020, the Malaysia Domestic Trade and Consumer Affairs Ministry has received 1,731 consumer complaints related to online purchases and nearly 70% of the complaints have to do with customers not receiving the item or service from merchants[18]. As discussed above, Regulation 3(1) of Consumer Protection (Electronic Trade Transactions) Regulations 2012 requires the vendor to disclose estimated time of delivery of goods or services on the webpage.
Further, the DSASA requires a contract which is above RM300 to be made in writing and shall contain the provision of ‘cooling-off’ period (10 working days). These would mean that the e-consumers have the liberty to cancel any online transaction that they have made and their payment is returned if they are not satisfied with the products delivered or with the delay in delivery.
In the United States, the late delivery of goods and services issue is tackled as false advertisement. This is demonstrated by the action of the Federal Trade Commission to charge SuperGoodDeals.com. Inc, an online marketer, with falsely promising consumers next-day shipping of facemasks and other personal protective equipment (PPE) after the company advertised in its webpage in March that the PPE was “in stock,” and “Pay Today, Ships Tomorrow.” However, after the investigation, the FTC found that it took several weeks for SuperGoodDeals to ship the PPE merchandise that were ordered by the customers.[19]
8. Quality of goods and services
In term of the quality of goods and services, the Malaysia laws protects consumer from the supply of goods and services with unsatisfactory quality. The inability of e-consumer to inspect the products prior to making online purchasing, would expose them to receiving unsatisfactory quality or defect products. Section 32 of CPA introduces the concept of implied guarantee as to acceptable quality. Furthermore, Section 34 of the CPA imposes a duty on the seller to deliver the goods which correspond with the description and Section 15 of Sale of Goods Act 1957 (SOGA) implies that goods delivered shall conform exactly to the description.
In Australia, Section 56 of Australian Consumer Law requires the supplier of goods to guarantee the supplied goods are of acceptable quality. Though a similar provision could not be found in United States law, however the Consumer Product Safety Commission (CPSC) is established to ensure that the supplied products fulfill the specified safety standards.
9. Data Protection
Issues related of data protection is another concern to the e-consumers as they have to provide their personal data including the information pertaining to their credit cards in order to buy goods or services online. The mis-use or leakage of such data might harm the e-consumers. In Malaysia, the government enacted several laws to protect the e-consumer from such harm. Cyber laws such as the Computer Crime Act 1997 makes unauthorized access to computers, programs, data and other IT information an offence. In the context of online shopping, the CCA to some extent protects e-consumers’ interest with regard to the security of online payment. Another relevant law is the Personal Data Protection Act 2010 (PDPA) in which Section 130 of the act makes unlawful collecting and disclosing of personal data in respect of commercial transaction an offence which is punishable with a fine not exceeding RM500,000 or imprisonment not exceeding 3 years or both.
In the United States, the ROSCA prohibits data pass marketing in the online context. Data pass occurs when an online shopper makes a purchase with an initial merchant, but that merchant then uses a third party to process the payment. Without regulation, this opens the door for the third party to sell the customer’s data, making a profit off of the unknowing consumer’s personal information[20]. ROSCA requires third party sellers:
a) to provide clear pre-sale information disclosure to consumers, including the fact that they are not affiliated with the initial merchant.
b) to obtain directly from the consumer his or her express informed consent, which must include the full amount to be charged, the consumer’s contact information, and an “additional affirmative action” by the consumer.
The Computer Fraud and Abuse Act criminalizes threat of damaging another person’s computer equipment, stealing computer data, publicly disseminating stolen data and refusing to repair damage the offender caused to one’s computer, such as through ransomware. Under certain circumstances, the law permits victims of computer fraud the right to bring civil actions against offenders for injunctive and compensatory relief[21].
10. Unfair terms and conditions in online contract
The terms and conditions of the online shopping is usually set by the business and the e-consumer does not have any hand on it. As decided in the case of Saad Bin Marwi v Chan Hwan, the doctrine of inequality of bargaining power is recognised as part of the Malaysian law, therefore, it is crucial that the law protect the e-consumer from any unreasonable terms and conditions in consumer contracts[22]. Unfair terms and conditions such as no right to refund, right of seller to unilaterally change the products, seller absolve from any responsibility during delivery and et cetera, should not be allowed to be in the online contract.
In this regard, the Malaysia CPA is quite strict in prohibiting the application of unfair contract terms in online shopping contract. Section 24I of CPA makes it an offence for entering into unfair contract and a corporate body shall on conviction liable to a fine not exceeding RM250,000, while an individual shall on conviction liable to a fine not exceeding RM100,000 or not more than 3 years imprisonment or both. The Australian Consumer Law does not hold the business accountable in this regard, however Section 23 of Australian Consumer Law provides that a term of a consumer contract or small business contract may be declared void if the term is unfair.
11. Safety of products offered in online market
Part III of the CPA provides protection for e-consumer from unsafe product and services whereby the Minister may prescribe the safety standard of any products and services. For the products or services which have yet to be prescribed with safety standard, the person supplying or offering to supply the goods or services are required to adopt and observe a reasonable standard of safety to be expected by a reasonable consumer. Nonetheless, this part does not apply for healthcare goods and food.
In term of medical products, Malaysian has good legislation and policy framework in protecting the consumers. The Malaysian National Medicines Policy 2012 outlines the strategies to ensure the quality, safety and efficacy of supplied medicines[23]. All drugs and cosmetics products are required to be registered under the Control of Drugs and Cosmetics Regulations 1984 before they can be sold or marketed to consumers. Health Supplement, Traditional medicines and over-the-counter products that are registered with the Ministry of Health (MOH) carry both registration numbers that begin with “MAL”, followed by 8-digit numbers and ends with an alphabet and Meditag Hologram labels on its label or packaging.[24]
In the United States, the US Food and Drug Administration (FDA) launched a campaign known as BesafeRx to educate the e-consumer on e-pharmacy. The federal government also passed a specific law to regulate the online pharmacy known as Ryan Haight Online Pharmacy Consumer Protection Act 2008. The act requires the online pharmacy to obtain a valid prescription in order to distribute drugs, which must consist of at least one face-to-face doctor-patient interaction[25]. The act was enacted after a teenager, Ryan Haight, aged 18, was found dead from an overdose of prescription drugs he had purchased online. This is in addition to the existing Federal Food, Drug and Cosmetic Act 1938. Each state formulated relevant regulations on online drug transactions, such as New York drew up the “Online Pharmacy Consumer Protection Act”, while the online pharmacy without permission to sell drugs to anyone in Florida would be punished with two offences according to the state law.
12. Redress mechanism for oversea transaction
Another hindrance for e-consumer is the availability of effective redress mechanism when it involves cross-border transaction. The traditional redress mechanism can be costly and lengthy, and even where a judgment was obtained, the consumer may face difficulty to enforce the judgement against the trader in different countries due to the different jurisdiction and locality. An alternative that was created to address this issue is Online Dispute Resolution (ODR). ODR can assist the parties in resolving the dispute in a simple, fast, flexible and secure manner, without the need for physical presence at a meeting or hearing. ODR encompasses a broad range of approaches and forms (including but not limited to ombudsmen, complaints boards, negotiation, conciliation, mediation, facilitated settlement, arbitration and others), and the potential for hybrid processes comprising both online and offline elements. As such, ODR represents significant opportunities for access to dispute resolution by buyers and sellers concluding cross-border commercial transactions, both in developed and developing countries[26].
Malaysia as part of South East Asian countries has established a good cooperation with other ASEAN countries under the ASEAN Committee on Consumer Protection (ACCP) to proliferate the development of e-commerce as well as protecting the rights of e-consumers. In this regard, the ACCP has been advocating for the establishment of a regional ODR. Strategic Goal 3 of ASEAN Strategic Action Plan for Consumer Protection (ASAPCP) 2025 outlines the setting up of the ASEAN Regional Online Dispute Resolution (ODR) mechanism, including national ODR systems.[27]
Organisation of American States (OAS) comprising the United States, Canada, several Latin American and few Caribbean countries established in 2010 a OAS-ODR Initiative for electronic resolution of cross-border e-commerce consumer disputes, to promote confidence and provide quick resolution and enforcement of disputes across borders, languages, and different legal jurisdictions. The process utilizes ODR technology to provide negotiation, mediation and arbitration for cross-border consumer claims up to USD$10,000. However, the buyer retains full rights to pursue other forms of redress, including protection programmes provided by third party organisations or payment channels. Both parties also retain the right to be represented by an attorney, though representation is not mandatory. Under this process, a buyer may file a cross-border complaint online against a registered vendor if they both reside in countries that have agreed to participate in the system. The default language of communication during the process will be the language used to conduct the transaction in the first place[28].
Conclusion
From the analysis, it is cleart that Malaysia has an extensive protection framework and comparable with developed countries such as Australia and United States to ensure that the e-consumers are protected. This is in line with the government policy that encourages the growth of online shopping consistent with the advancement of Industrial Revolution 4.0 and fintech. However, there is still room for improvement to enhance the protection available for online shoppers. Issues such as negative options, data pass marketing and cramming are yet to be addressed by specific provisions under the law. Nonetheless, there is provision on protection from unfair practices that could be utilized to protect e-consumers from such practices. The issue remains as to the extent of effectiveness of the provided protection. Apart from that, the US also has laws, such as anti-spam law that protects consumer from unsought advertisement, which are not available in Malaysia. Therefore, review on the existing consumer protection legislations need to be implemented from time to time in order to strengthen consumer confidence in online shopping and further protect the rights of e-consumers as well as to accommodate advances in internet technologies.
Table
1: Comparative table on protection available for E-Consumer in Malaysia,
Australia and United States
|
Countries
Issues of
concern
|
Malaysia
|
Australia
|
United
States
|
|
Misleading
information, false advertisements and unfair practises
|
·
Section 10 Consumer Protection Act (CPA) prohibits
misleading and false representation of the products and services.
·
Section 12 of
CPA prohibits misleading indication as to price.
· Penalty - Individual: Fine not exceeding RM100,000 or
to 3 years imprisonment or to both; Body corporate: Fine not exceeding
RM250,000.
· Medical
products - Section 4B of Medicines
(Advertisement and Sales) Act 1956 requires that advertisements of medicines
to be approved by Medicine Advertisements Board.
· Banking
products - The Financial Services
Act 2013 (FSA), Islamic Financial Services Act 2013 (IFSA) and the
Development Financial Institutions Act 2002 (DFIA) prohibit financial service
providers (FSPs) from engaging in conduct that is misleading or deceptive in
relation to the nature, features, terms or price of any financial service or
product. Such prohibited business conduct is set out in Schedule 7 of the FSA
and IFSA and the Second Schedule of the DFIA.
|
·
Section 29 of Australian
Consumer Law prohibits false or
misleading representations about goods or services
·
Section 47 of Australian
Consumer Law prohibits multiple pricing.
·
Australian
Communications and Media Authority (ACMA) gave legal force to an
industry-developed mobile premium services code (MPSC), which notably
introduces a double opt-in requirement whereby a prospective consumer will
have to give two independent confirmations of a request before being able to
subscribe to an ongoing premium SMS service.
·
Medical
products - Therapeutic Goods Administration is given the authority to
assess and approve medicines that are to be sold in Australia and on websites
operated by Australian companies. Advertisement with regard to the approved
medicine is subject to requirements under the Therapeutic Goods Regulations
1990
|
· Section
52 of Federal Trade Commission Act makes an offence to
desiminate false advertisement and upon conviction that person shall
be punished by a fine of not more than $5,000 or by imprisonment for not more
than 6 months, or by both.
· Section
4 of ROSCA prohibits online sellers from charging a consumer for any good or
service with a negative option feature in an online transaction, unless the
seller i) clearly and conspicuously discloses to consumers all the material
terms of the transaction; ii) has obtained consumer consent before charging
them, and iii) provides a simple way for consumers to stop charges.
· Section
5(a) of the Federal Trade Commission Act (FTC Act) prohibits “unfair or
deceptive acts or practices in or affecting commerce.” This prohibition
applies to all persons engaged in commerce, including banks.
· ROSCA
imposes a penalty of $16,000 per violation.
|
|
Bait advertisement
|
· Section 13 of CPA
prohibits bait advertisement. · Section 14 of CPA
lays out rules to be applied if gift,
prize or other free item to be offered
to consumer as part of buying the product or service.
· Upon conviction of contravening Section 10 or
Section 12 of CPA, an individual is liable to a fine not exceeding RM100,000
or to 3 years imprisonment or to both and a body corporate is liable to a
fine not exceeding RM250,000.
|
· No specific
provision
|
· No specific
provision
|
|
Inadequate disclosure of information
|
·
Consumer
Protection (Electronic Trade Transactions) Regulations 2012 enacted under
Section
-
Regulation 3(1)
requires the vendor to disclose information on name of person/business;
registration no.; email address and telephone no. / address of business; description
of goods/services; full price; method of payment; terms and conditions; and,
estimated time of delivery on the webpage.
-
Regulation 4
requires online marketplace operator to keep and maintain record of
its online sellers every 2 years.
·
Section 20 of Direct Sales and
Anti-Pyramid Scheme Act 1993 (DSASA)
|
No specific provisions
|
·
The Federal Trade Commission (FTC)
issued its “Dot Com Disclosures” guidance document to clarify that the FTC’s
rules and regulations promulgated under the Federal Trade Commission Act
apply to virtual activities. The FTC
requires all legal disclosures made electronically to be clear and
conspicuous. This means that online representations must be near the
website’s product or service, appear for a sufficient duration or be
unavoidable to web viewers, and be presented in a form that the average web
consumer would be able to understand.
|
|
Delayed or non-delivery of goods and services
|
·
The vendor is required to disclose estimated time of
delivery of goods or services on the webpage (Regulation 3(1) Consumer Protection (Electronic Trade Transactions)
Regulations 2012)
·
Section 16 of the CPA imposes criminal liability on the trader for accepting payment but
intends not to supply the goods or services.
|
No specific provisions
|
No specific
provisions
|
|
Quality of goods and services
|
·
Section 32 of CPA introduces the concept of implied
guarantee as to acceptable quality.
·
Section 34 of
the CPA imposes a duty on the seller to deliver the goods which correspond
with the description.
·
Section 15 of
Sale of Goods Act 1957 (SOGA) implies that goods delivered shall conform
exactly to the description.
|
· Section 56 of Australian Consumer Law requires the supplier of goods to guarantee the
supplied Goods are of acceptable quality
|
No specific provisions. However, Consumer
Product Safety Commission (CPSC) is responsible to ensure that the products
fulfill the safety standards.
|
|
Data protection
|
· Section 130 of
Personal Data Protection Act 2010 (PDPA) makes unlawful collecting and disclosing
of personal data in respect of commercial transaction an offence which is
punishable with a fine not exceeding RM500,000 or imprisonment not exceeding
3 years or both.
|
· Australia regulates
data privacy and protection through a mix of federal, state and territory
laws. The Federal Privacy Act 1988 and its Australian Privacy Principles
(APPs) apply to private sector entities with an annual turnover of at least
AU$3 million, and all Commonwealth Government and Australian Capital
Territory Government agencies.
· Consumer Data Act
2017 allows the consumers to require information relating to themselves in those sectors
to be disclosed safely, efficiently and conveniently
|
·
The Computer Fraud and
Abuse Act criminalizes threat of damaging another person’s computer
equipment, stealing computer data, publicly disseminating stolen data and
refusing to repair damage the offender caused to one’s computer, such as
through ransomware. Under certain circumstances, the law permits victims of
computer fraud the right to bring civil actions against offenders for
injunctive and compensatory relief.
·
The Restore
Online Shoppers’ Confidence Act (“ROSCA”) prohibits data pass marketing in
the online context. ROSCA requires third party sellers to provide clear
pre-sale information disclosure to consumers, including the fact that they
are not affiliated with the initial merchant. ROSCA further requires such
sellers to obtain directly from the consumer his or her express informed
consent, which must include the full amount to be charged, the consumer’s
contact information, and an “additional affirmative action” by the consumer.
|
|
Unfair Contract Terms
|
· Section 24I of
CPA makes it an offence for entering into unfair contract and a corporate
body shall on conviction liable to a
fine not exceeding RM250,000, while an individual shall on conviction liable
to a fine not exceeding RM100,000 or not more than 3 years imprisonment or
both.
|
· Section 23 of Australian Consumer Law provides that a term of a consumer contract or small business
contract may be declared void if the term is unfair.
|
·
No specific
provisions
|
|
Products safety
and liability
|
· Section 20 of CPA
makes an obligation for supplier of goods and services to ensure the offered
or advertised goods and services comply
with the safety standards.
|
· Section 106 and
107 of Australian Consumer Law prohibit the
supply of goods and services that are not in compliance with safety
standards.
|
· Consumer Product Safety Act 1972 established
the Consumer Product Safety Commission which is authorized to develop
standards for product safety and ban unsafe products.
· Medical
products
– introduced Ryan Haight Online Pharmacy Consumer Protection Act 2008 to
regulate the prescription of controlled substances dispensed by means of
internet
· Federal
Food, Drugs and Cosmetic Act control the dispensing of drugs.
|
|
Redress
mechanism for cross-border transaction
|
There is
cooperation between ASEAN countries under the ASEAN Committee on Consumer
Protection (ACCP). Strategic
Goal 3 of ASEAN Strategic Action Plan for Consumer Protection (ASAPCP) 2025
outlines the setting up of the ASEAN Regional Online Dispute Resolution (ODR)
mechanism, including national ODR systems.
|
No information
|
·
Organisation of American States (OAS) comprising the United
States, Canada, several Latin American and few Caribbean countries
established in 2010 a OAS-ODR Initiative for electronic resolution of cross-border
e-commerce consumer disputes, to promote confidence and provide quick
resolution and enforcement of disputes across borders, languages, and
different legal jurisdictions.
|
References
Amin, Naemah & Mohd Nor, Roshazlizawati, “Online shopping in Malaysia: Legal Protection for E-consumers”, European Journal of Business and Management, 2013.
ASEAN, ‘The ASEAN Strategic Action Plan for Consumer Protection (Asapcp) 2016- 2025: Meeting The Challenges of A People-Centered ASEAN Beyond 2015’.
Bank Negara Malaysia, “Prohibited Business Conduct”, 15 July 2016.
Bob Schultz, “Online Pharmacy Regulation: How the Ryan Haight Online Pharmacy Consumer Protection Act Can Help Solve an International Problem”, 16 San Diego Int'l L.J. 2015.
Bracken, Michael, “Online pharmacy retailer pays $32,400 for misleading product pricing”, Pharmacy Insights, 10 March 2016.
Department of Health, <https://www.tga.gov.au/complying-advertising-requirements> accessed 5 December 2020.
Organization for Economic Co-operation and Development (OECD), Unpacking E-Commerce: Bussiness Model, Trends and Policies, 2019
Federal Trade Commission, “Dot Com Disclosure: Information About Online Advertising”, May 2000
Federal Trade Commission, “Negative Options, A Report by the Staff of the FTC’s Division of Enforcement” (January 2009).
Federal Trade Commission, “FTC Takes Action against Marketer That Falsely Promised Consumers Next Day Shipping of Facemasks and Other Personal Protective Equipment”, 8 July 2020.
Law Shelf, Online Consumer Protection in E-Commerce Transactions- Module 3 of 5.
Malaysian Communications and Multimedia Commission, E-Commerce Consumers Survey 2018, pp. 8 – 12.
“Malaysia’s online retail sales up 28.9% in April”, The Star (Kuala Lumpur, 11 June 2020)
Metzger, Tyler, “Visa tackles deceptive online ‘data pass marketing”, 27 April 2010.
Ministry of Health Malaysia, “How to recognize approved advertisement?”, 6 March 2020
Ministry of Health Malaysia, Malaysian National Medicines Policy 2012, Edisi ke-2, 2013.
O.Omala, Sodiq & A. Oseni Umar, Towards an Effective Legal Framework for Online Dispute Resolution in E-Commerce Transactions: Trends, Traditions, and Transitions, IIUM Law Journal.
Organization for Economic Co-operation and Development (OECD), “Report on Consumer Protection in Online and Mobile Payments”, OECD Digital Economy Papers, No. 204, OECD Publishing, Paris.
‘Over 1,700 complaints over online shopping’, The Star (Petaling Jaya, 6 May 2020).
Radhakrishna, Gita, “Liability Issues in Internet Banking In Malaysia”, Communications of the IBIMA, Vol. 7, 2009.
Santoso, Edy, “Consumer Protection for Online Banking Scams via E-mail in Malaysia”, UUM Journal of Legal Studies, v. 3, p. 1-22, December 2012.
The ASEAN Secretariat, “Handbook on ASEAN Consumer Protection Laws and Regulation, June 2018.
Trakic, Adnan, “Statutory protection of Malaysian consumers against unfair contract terms: Has enough been done?”, Common Law World Review, 2015.
United Nations Commission on International Trade Law, UNCITRAL Technical Notes on Online Dispute Resolution, 2017.
Footnotes
[1] Organization for Economic Co-operation and Development (OECD), Unpacking E-Commerce: Bussiness Model, Trends and Policies, 2019, <https://www.oecd-ilibrary.org/sites/1885800a-en/index.html?itemId=/content/component/1885800a-en> accessed 1 December 2020 en#:~:text=More%20specifically%2C%20Eurostat%20defines%20e,mediated%20(online%20communication)%20networks> accessed 1 December 2020.
[2] Amin, Naemah & Mohd Nor, Roshazlizawati, “Online shopping in Malaysia: Legal Protection for E-consumers”, European Journal of Business and Management, 2013, p. 79.
[3] Malaysian Communications and Multimedia Commission, E-Commerce Consumers Survey 2018, pp. 8 – 12, <https://www.mcmc.gov.my/skmmgovmy/media/General/pdf/ECS2018.pdf> accessed 1 December 2020.
[4] “Malaysia’s online retail sales up 28.9% in April”, The Star (Kuala Lumpur, 11 June 2020), < https://www.thestar.com.my/business/business-news/2020/06/11/malaysia039s-online-retail-sales-up-289--in-april> accessed 1 December 2020.
[6] OECD (2012-08-17), “Report on Consumer Protection in Online and Mobile Payments”, OECD Digital Economy Papers, No. 204, OECD Publishing, Paris, <https://www.oecd-ilibrary.org/docserver/5k9490gwp7f3-en.pdf?expires=1607147082&id=id&accname=guest&checksum=8AEE83E01C0DD2872623EE7290906652> accessed 2 December 2020
[9] Federal Trade Commission, “Dot Com Disclosure: Information About Online Advertising”, May 2000, p.1 - 21 <https://www.ftc.gov/sites/default/files/attachments/press-releases/ftc-staff-issues-guidelines-internet-advertising/0005dotcomstaffreport.pdf> accessed 1 December 2020.
[10] Bracken, Michael, “Online pharmacy retailer pays $32,400 for misleading product pricing”, Pharmacy Insights, 10 March 2016 <https://www.meridianlawyers.com.au/insights/online-pharmacy-retailer-pays-32400-misleading-product-pricing/> accessed 1 December 2020.
[12] Federal Trade Commission, “Negative Options, A Report by the Staff of the FTC’s Division of Enforcement” (January 2009), p. I, <https://www.ftc.gov/sites/default/files/documents/reports/negative-options-federal-trade-commission-workshop-analyzing-negative-option-marketing-report-staff/p064202negativeoptionreport.pdf> accessed 30 November 2020.
[14] Ministry of Health Malaysia, “How to recognize approved advertisement?”, 6 March 2020, https://www.pharmacy.gov.my/v2/en/content/how-recognize-approved-advertisement.html accessed on 3 December 2020
[15] Department of Health, <https://www.tga.gov.au/complying-advertising-requirements> accessed 5 December 2020.
[16]Bank Negara Malaysia, “Prohibited Business Conduct”, 15 July 2016, <https://www.bnm.gov.my/index.php?ch=57&pg=140&ac=552&bb=file> accessed 1 December 2020
[17] Santoso, Edy, “Consumer Protection for Online Banking Scams via E-mail in Malaysia”, UUM Journal of Legal Studies, v. 3, p. 1-22, December 2012, <http://e-journal.uum.edu.my/index.php/uumjls/article/view/4547> accessed 1 December 2020. Radhakrishna, Gita, “Liability Issues in Internet Banking In Malaysia”, Communications of the IBIMA, Vol. 7, 2009, p. 2, <https://www.researchgate.net/publication/51018273_Liability_Issues_in_Internet_Banking_In_Malaysia> accessed 1 December 2020
[18] ‘Over 1,700 complaints over online shopping’, The Star (Petaling Jaya, 6 May 2020) <https://www.thestar.com.my/news/nation/2020/05/06/over-1700-complaints-over-online-shopping> accessed 1 December 2020
[19] Federal Trade Commission, “FTC Takes Action against Marketer That Falsely Promised Consumers Next Day Shipping of Facemasks and Other Personal Protective Equipment”, 8 July 2020, <https://www.ftc.gov/news-events/press-releases/2020/07/ftc-takes-action-against-marketer-that-falsely-promised-next-day-shipping?utm_source=govdelivery> accessed 1 December 2020
[20] Metzger, Tyler, “Visa tackles deceptive online ‘data pass marketing”, 27 April 2010, <https://www.creditcards.com/credit-card-news/visa-data-pass-deceptive-marketing-1282/#:~:text=The%20company%20specifically%20seeks%20to,before%20the%20transaction%20is%20complete.> accessed 5 December 2020.
[21] Law Shelf, Online Consumer Protection in E-Commerce Transactions- Module 3 of 5, <https://lawshelf.com/videocoursesmoduleview/online-consumer-protection-in-e-commerce-transactions-module-3-of-5/> accessed on 30 November 2020
[22] Trakic, Adnan, “Statutory protection of Malaysian consumers against unfair contract terms: Has enough been done?”, Common Law World Review, 2015, p. 205. <https://www.researchgate.net/publication/282896437_Statutory_protection_of_Malaysian_consumers_against_unfair_contract_terms_Has_enough_been_done> accessed on 4 December 2020.
[23] Ministry of Health Malaysia, Malaysian National Medicines Policy 2012, Edisi ke-2, 2013, < https://www.pharmacy.gov.my/v2/sites/default/files/document-upload/buku-dunas.pdf> accessed 1 December 2020.
[25] Bob Schultz, “Online Pharmacy Regulation: How the Ryan Haight Online Pharmacy Consumer Protection Act Can Help Solve an International Problem”, 16 San Diego Int'l L.J. 2015, p. 402, <https://digital.sandiego.edu/cgi/viewcontent.cgi?article=1033&context=ilj> accessed on 2 December 2020.
[26] United Nations Commission on International Trade Law, UNCITRAL Technical Notes on Online Dispute Resolution, 2017, p. 1 <https://www.uncitral.org/pdf/english/texts/odr/V1700382_English_Technical_Notes_on_ODR.pdf> accessed on 4 December 2020.
[27] ASEAN, ‘The ASEAN Strategic Action Plan for Consumer Protection (Asapcp) 2016- 2025: Meeting The Challenges of A People-Centered ASEAN Beyond 2015’, <https://aseanconsumer.org/file/post_image/The%20ASEAN%20Strategic%20Action%20Plan%20For%20Consumer%20Protection%202016_2025%20Meeting%20The%20Challenges%20of%20A%20People%20%20Centered%20ASEAN%20Beyond%202015.pdf> accessed 1 December 2020. The ASEAN Secretariat, “Handbook on ASEAN Consumer Protection Laws and Regulation, June 2018, <https://asean.org/wp-content/uploads/2018/05/Handbook-on-ASEAN-Consumer-Protection-Laws-and-Regulation.pdf> accessed 1 December 2020
[28] O.Omala, Sodiq & A. Oseni Umar, Towards an Effective Legal Framework for Online Dispute Resolution in E-Commerce Transactions: Trends, Traditions, and Transitions, IIUM Law Journal, p. 279. <https://journals.iium.edu.my/iiumlj/index.php/iiumlj/article/view/236/184> accessed on 4 December 2020.
Tiada ulasan:
Catat Ulasan